Monday, November 17, 2008

Help the Automakers: Michigan's Future Depends on It

I know this isn't a review, but I thought this message from the president of my alma mater (Michigan Tech) was quite timely. Hopefully it will change a few minds about giving the auto industry a loan!

BTW - I sent this article as an email to some of my friends and it has produced quite a spirited discussion. Where do I stand on this? I'm not a fan of bailouts, but I think a "loan" to help the big three move on to oil independence would be quite timely, environmentally and national security friendly, and would also help to avoid a great depression. I'm not sure how people want an industry to fail that supports 1 in 10 jobs in America and not think it will sink our country into chaos. What do you think? I'm interested, please post a comment.

Help the Automakers: Michigan's Future Depends on It

Michigan Tech President Glenn D. Mroz

Most of us in Michigan know that the auto industry does a lot more than make cars and trucks. The "Big Three" in Detroit support millions of employees and retirees—not just their own, but those of their suppliers and dealers—and millions more in the health care, retail and service industries that those employees and their families use.

But the degree to which they also support education—the the ticket to our childrens future—may come as a surprise. For example, over the years General Motors, Ford and Chrysler have contributed substantially to Michigan Technological University, enabling the University to conduct cutting-edge research and provide priceless hands-on training for tomorrow's engineers and business leaders. The alternative fuels and the clean vehicles to use them that we so desperately need are being developed at Michigan universities and elsewhere with the support of the auto industry.

Consider the following from our own experience at Michigan Tech: GM, Ford and Chrysler sponsor Senior Design projects and Enterprise programs, the centerpieces of our discovery-based learning experience. Much more than classroom exercises, these projects give tomorrow's automotive engineers, technologists and business leaders an opportunity to solve real-world problems, to the benefit of industry and the economy. A 2006 Senior Design project sponsored by GM at Michigan Tech recently generated three patents.

Last year Ford established its first remote Information Technology (IT) Development Center in Houghton, home of Michigan Tech. There, computer science, technology, engineering and business students earn money for college while putting the skills they learned in class to work incorporating the latest in computer technology into Ford products.

Chrysler partners with the Keweenaw Research Center at Michigan Tech to test vehicles under winter driving conditions. They have also donated vehicles for students to study.

It's no wonder that more than 2,000 Michigan Tech alumni have been employed at the big three, and many more from other Michigan universities. The Big Three and Michigan universities are working partners, educating skilled workers and creating Michigan's and the nation's future. But there is even more at stake than that.

US carmakers have 105 plants in 20 states. They support 14,000 dealers across the country, who in turn employ 740,000 people. The automakers buy $156 billion in parts and services from suppliers in every state. The collapse of the Detroit automakers would lead to widespread failure of these suppliers, who also supply the non-US auto manufacturers. It would quickly put an estimated 3 million people out of jobs and cost this country $150 billion in spendable income and $45 billion in taxes those unemployed people won't be paying.

With all this at stake, Governor Jennifer Granholm has warned that allowing the Big Three to go into bankruptcy would push the automakers over a cliff and threaten their very survival. In our view, if such a catastrophe gives the country the economic equivalent of a severe case of the flu, it would give Michigan pneumonia.

Please join me in urging Congress to provide the support our auto industry needs.

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